Skip to main content
2:30 am
see you next week on "open house." journal report." i'm maria bartiromo. the candidates your money and the election them power of the presidency. what obama or romney would mean to the markets and the economy. then the bombshell accusations by a banker turned whistle-blower. my interview with greg smith about why he left one of the most prestigious financial firms in the world and the charges he makes. what was the last straw for you? cooking up the formula for success for small businesses. the difference between the winners and losers. the "wall street journal report" begins right now. here's a look at what is making news as we head in to a
2:31 am
new week on wall street. encouraging news about the economy. the gdp grew at a better than expected rate, up 2% for the third quarter. the gdp is the broadest overall measure of the size and strength of the u.s. economy. economists were expecting a growth rate of 1.8%. the number buoyed by an increase in consumer spending and stronger housing market. the air went out of stocks midweek. the dow fell 250 points on wednesday after poor earnings news and the market was flat later in the week. big multinationals did not farewell in earnings. caterpillar missed revenues and dupont fell short and said it would cut 1500 jobs. 3m met kpapt tigss and boeing and proctor & gamble beat expectations. among technology and internet companies, facebook and dwra hao beat expectations but facebook and disappointed. the ipad mini is lighter than
2:32 am
the full size ipad and 7.9 inches and $329. two product launches for microsoft introducing windows 8 than tablet, the surface which retails for $499. it's been anything bau strong earnings season so far. have companies squeezed all of the profits they can from the revenues get? and what affect will the elections have on the market? joining me is bob doll from black rock. thank you for joining us. >> thank you, maria. >> let's talk about earnings. we have seen disappointments in technology. how would you characterize the earnings season so far. >> mixed at best. the expectations have been lower ed the last 60 or so days. while companies on average are beating those they are low expectations and as you hinted the revenue line is disappointing. i'd add on top of that looks like analyst expectations for the fourth quarter and next year are on the high side. >> i have to come down. do you think that a is priced in
2:33 am
to the market? will earnings disappointments continue to affect stock prices lower? >> as you also know, the stock market is up to date more than earnings. the valuations or pe levels moved up. it is a tug of war between are earnings good enough and in this mediocre muddle through economy that we continue to see it has to be the question we're asking. profit margins can't be sustained at these levels if revenue growth is not there. >> do you think this is a company specific story or is this a slowdown as a result of the global economy? we know things are slowed down quite a bit outside of the united states, as well? >> yeah. there are enough companies that have tripped that this is not just a specific company environment. as you hinted, geography does matter. companies primarily domestic, u.s. oriented tend to be having better earnings reports than those that have significant businesses outside of the u.s. >> here we are a few days away
2:34 am
from the presidential election. what impact do you expect the election to have on the economy and the markets? what would a romney presidency mean versus an obama re-election? >> i think we have to start by saying that it is so close that uncertainty is killing everyone. i have read articles about gee what happens if we don't know the next morning. it will mean neither candidate has a mandate. we need more compromise and we will have more loggerheads and more polarization. i wish it could be different. >> that's the issue. we haven't seen the two sides get together. they are unable to compromise. we have the fiscal cliff looming. why would it be better in terms of compromising and getting things done? >> so the optimist in me says, okay if it is mitt romney he was a republican governor in a state that was highly democratic and he figured out how to get it done. if president obama is re-elected, he's got to worry about his legacy and maybe he
2:35 am
will do some things to say let's not just sit here and look at each other with nasty faces. maybe we get something done. >> reare seeing consumer optimism opposed to corporate pessimism. who's right. >> six months ago it was the opposite. i think it will alternate in this muddle-through economy. 2% gdp. we just got that at the end of the week on top of 2.4 in 2010, 2.0 last year. the first three quarters averaging 2.7. the 2% growth we can't get out of the way. >> what about the housing market? it feels like it is doing better, feels like it's on the rebound. how important is that and do you believe we are seeing an improvement in housing? >> i think we are seeing a slow, bumpy recovery in housing. government is trying to do a lot to help. it is part of the reason why the consumer is feeling better. i think housing is key.
2:36 am
remember, housing, mortgaging credit almost did us in a few years ago. so that healing slowly is a good thing. >> let's talk fed for the for a moment. this week the federal reserve will up left the interest rates unchanged and said it would buy mortgage backed securities at $40 billion a month. the quantitative easing qe continues. any surprises from the fed? >> zero. they almost nothing as you know on top of a fair amount the month before. they will be watching and waiting to see the impact of this 40 billion a month and the other things you put on the list. i think the fed will continue to do what it is doing until we see changes and that a may not be for a few more months. >> now word that ben bernanke will not stand for a second term as chairman in 2014 and mitt romney said he will not reappoint bernanke. what do you think this means.
2:37 am
>> has the fed already been politicized? back to the government leaving it alone. i wish the fiscal policymakers would work on fiscal policy and not point the finger at monetary policy. >> what should toward be doing? >> carefully i think you need diversify case in this kind of environment. don't have all of anything. that means don't sell all of your bonds even though interest rates are low. be careful of your duration. on the equity side if you have enjoyed the profits this year maybe take a little off the table. if you are wait and waiting dollar cost average in. i think you need exposure in various categories. watch free cash flow. that's the ticket. >> appreciate your time today. thank you very much. bob doll joining us. the goldman sachs banker whose letter of resignation made
2:38 am
the "new york times" what greg smith told me about wall street and who's in charge of your money. small businesses employ half of americans and. as we take a break look at how the stock market ended the week. n you take a closer look... the best schools in the world... see they all have something very interesting in common. they have teachers... ...with a deeper knowledge of their subjects. as a result, their students achieve at a higher level. let's develop more stars in education. let's invest in our teachers... they can inspire our students. let's solve this. how they'll live tomorrow. for more than 116 years,
2:39 am
ameriprise financial has worked for their clients' futures. helping millions of americans retire on their terms. when they want. where they want. doing what they want. ameriprise. the strength of a leader in retirement planning. the heart of 10,000 advisors working with you one-to-one. together for your future. ♪
2:40 am
>> anything that makes us more interspecktive and review our policies is not a lost exercise. >> that was lloyd on the charges levelled from the former employ employee that quit by way of a "new york times" op-ed. greg smith described out of touch bankers referring to clients as muppets one of the final straws that he says ended his career at goldman sachs last spring. goldman says it is not true.
2:41 am
smith published a new book about his experience inside of one of the wall street's best-known firms. i asked him about money and muppets. what do you think it means to call somebody a muppet? they say they can't find any evidence that they called anybody a muppet? >> this is your word against their word. >> i would say a couple of things. there was an e-mail where a client was called a pup met but verbally i saw it happen over and over again. and a muppet is not a friendly puppet it is someone you can take advantage or manipulate and pull their strings. in my mind, the idea of going on a muppet hunt and finding evidence of the word muppet is a hallow exercise. it is not about calling someone a name. wall street is a tough place and i competed there a lot time. it is a reason they are calling them a muppet that they should
2:42 am
be investigating. why did we use the client's information to place our own bets. >> a lot of attention has been paid attention to your book and they said that mr. smith's op-ed portrayed that firm that unrecognizable to us but we conduct canned a thorough review and found no evidence to support his claims but that he appeared frustrated about his career and future prospects at goldman sachs. how accurate is your memoir? goldman is saying your motivations are different, that you weren't being paid enough. >> first thing you have to ask yourself is by goldman attacking me as hard as they are and not addressing the issues raised you have to ask yourself is there something they don't want coming out? i saw someone quoted saying gold mavn was relieved by what is in my book. i would say to you, maybe people on wall street feelt feel that way.
2:43 am
but i guarantee people outside of wall street who read this book they won't find things like ripping up pension funds or betting against your clients or 'ole selling one that people don't understand will not be pleased and will find it egregious. look at what the market is telling you and where stockholders are valueing jpmorgan, goldman sachs, a lot of them are below lick kwi dags. even investors don't like this business model. >> after you resigned and hit the send button, did you feel any moment of oh, my god, what did i do? >> i actually felt proud. i wanted toed spark a debate that i think if wall street had their way, i don't think that realize the too big to fail banks are bigger than before the crisis. if you watched the debates the
2:44 am
other night or the last three debates you would think that some kind of landmark financial reform has happened but three quarters of the deadlines have been missed. i would argue our politicians don't have an octoberive enough viewpoint and the reason is obvious. look at who funds political campaigns and look at this revolving door where the chairman of the sec or jake seward who worked for tim geithner now work for goldman sachs s. you how is this going to be fixed and get retail toward back. it doesn't feel like an even playing field to me. i believe there are great things that wall street does, helping companies merge, but betting against them without telling them that and frankly wall street banks are making 75% of their money in trading. i think you need to bring the pendulum back. i'd like to be a voice to shine
2:45 am
transparency on what is wrong and try to pick it. >> let's be transparent for your own story. you are denied a bonus on toop of your several hundred thousand dollar salary. when so many people like the goldman clients with retirements and pension funds you cite being concerned about are struggling to make ends meet how does that align with your personal values? >> there's a huge compensation bubble in wall street. certainly i was making a lot of money and i was grateful for it. if i was concerned about enriching myself what i would have done is stayed at goldman sachs or left quiet limit i would have gone to jpmorgan, morgan stanley or deutsche bank. i left because what i saw around me conflicted with what the firm was saying by saying we care about reputation and clients. >> you say they are doing important things, raising money
2:46 am
for businesses, merging businesses, raising money for individuals. are you forgetting t positives and what wall street and the banks mean to america, mean to the global economy? this gets lost in the translation often. >> let me be clear. if you watch a commercial on tv for how wall street would like to portray that they make money, you would believe they are making their money by helping companies merge or raising capital. the truth is they make less than 10% of their money that way. the way they make money is in the trading business and i think wall street needs to get back to the original way they made money and the reason are it is called finance is because it is about financing things. not information you get from clients to make bets for yourself. >> greg smith, "why i left goldman sachs: a wall street story." up next on the "wall street journal report," why you should tackle unpleasant tak tasks first things in the morning and other tips to put to work in
2:47 am
your life. and find us on facebook.
2:48 am
bob... oh, hey alex. just picking up some, brochures, posters copies of my acceptance speech. great! it's always good to have a backup plan, in case i get hit by a meteor. wow, your hair looks great. didn't realize they did photoshop here. hey, good call on those mugs. can't let 'em see what you're drinking. you know, i'm glad we're both running a nice, clean race. no need to get nasty. here's your "honk if you had an affair with taylor" yard sign.
2:49 am
looks good. [ male announcer ] fedex office. now save 50% on banners. aflac... and major medical? major medical, boyyy, yeah! [ beatboxing ] berr, der berrp... ♪ i help pay the doctor ♪ ain't that enough for you? ♪ there's things major medical doesn't do. aflac! pays cash so we don't have to fret. [ together ] ♪ something families should get ♪ ♪ like a safety net ♪ help with food, gas and rent, so cover your back, with... ♪ a-a-a-a-a-a-a-aflac! [ male announcer ] help protect your family at [ beatboxing ] 60% of jobs created the last decade is in small business. we are looking at the politics and practices of small business. rj ramberg is the host of your
2:50 am
business. it is your business 183 essential tips that will transfochl your small business. j.j., great to have you on the program. >> great to be here. >> small businesses are mentioned dozens of times in the presidential debates. how do small business owners you speak to feel about being a significant talking point in this campaign? >> i know. in the first one i think it was more than 25 times they mentioned small business within the first two minutes. the candidates are talking about them a lot. what i hear from small businesses is they are not necessarily talking about me one of the issues about small business is the sba defines a small business as 499 employees or less. i talk to a lot of people with 50, ten, one employee. >> we're talking very small. how do the policies of the candidates impact small business owners. >> the thing we hear about is extending or not extending the bush tax cuts to people earning over $250 thourk.
2:51 am
it affects a tiny percent of small business owners, 3%. >> isn't that 3% really where the job creators are? >> that's what the romney campaign says, yes, indeed. the nfib says it is responsible for 700,000 jobs if you raise taxes you will lose 700,000 jobs. it is very hard to get down to those numbers. >> how is business going for the small business group which is response able for job creators? >> definitely better than a few years ago. access to capital has been a big issue. small business lending is up. a lot of exciting things on the horizon. crowd funding with the jobs act will be available presumably sometime next year. so, and optimism is up, but there's a lot of uncertainty still and people say to me my biggest problem is demand. i need customers through the door. for that to happen the economy needs to get better. >> we need to see a better
2:52 am
demand story. what about the expense, health care reform is one thing we hear from small business, businesses with less than 50 full-time employees are exempt from the requirement to offer health insurance or pay a penalty. >> once you get to 50, 96% of businesses offer health care. the requirement they will have to isn't going to change much for most businesses. >> in the book you offer tips what sets apart successful small businesses and one that gets a lot of discussion is focus on why. tell me about that. >> this comes from simon cynic and he said when you talk about your company don't talk about what you do. anyone can do what you do. you need to talk about why you do it because that shows emotion and that getsome somebody emotionally connected with you. he talks about apple a lot. apple is really good at creating a why. >> i see. to resonate with the customer then. >> and to connect with them. i have a company, it is a search engine that donates money to charity. he asked me what my company does
2:53 am
and i said it is good search. he said no, anyone can do that. tell them why. i'm empowering people to do good every day. >> so it works for people trying to succeed. let's go through the tips. when someone offers to help be specific with how they can. >> this is one of my favorites. she said when someone asks to help you want to make it as easy as possible for them to help you because chances are they go back to the desk and get busy with whatever they are doing. give them three specific things. can you make an introduction for me, write my press release, look at my financials. if you give them three things you will up the chances they can do one of them and makes it easy for them. >> tackle unpleasant tasks first thing in the morning. >> comes from the ceo of zip car. he said if you have something hanging over you will be unproductive with everything else you are doing that day.
2:54 am
just get it done in the morning. >> like face it. >> exactly. >> good to have you on the program. thank you so much. j.j. ramberg, it's your business. up next a look at the news this coming week that will have an impact on your money and if you are concerned about your information on line, advice to ensure you are protected. it is not as easy as one, two, three. the worse pass words in the world when we come back. i'm a conservative investor. i invest in what i know. i turned 65 last week. i'm getting married. planning a life.
2:55 am
there are risks, sure. but, there's no reward without it. i want to be prepared for the long haul. i see a world bursting with opportunities. india, china, brazil, ishares, small-caps, large-caps, ishares. industrials. low cost. every dollar counts. ishares. income. dividends. bonds. i like bonds. ishares. commodities. diversification. choices. my own ideas. ishares. i want to use the same stuff the big guys use. ishares. 8 out of 10 large, professional investors choose ishares for their etfs. introducing the ishares core, etfs for the heart of your portfolio. tax efficient and low cost building blocks to help you keep more of what you earn. call your advisor. visit ishares. ishares. yeah, ishares. call 1-800-ishares for a prospectus which includes investment objectives, risks, charges and expenses. read and consider it carefully before investing.
2:56 am
more more on our show and our
2:57 am
guests, check out and look at the stories coming up in the week ahead that may impact your money. earnings will be out from chevron, pfizer, exxon mobil. auto companies will release earnings. ford, condoleeza rice leaner will owned fiat. the schiller index will report on home prices in 20 u.s. cities. on thursday we get auto sales numbers for october. on friday, the jobs report will be released. we will find out how many jobs the economy lost or gained in the last month. unemployment stands at 7.8% currently. finally today, a following security breach on sites like linkedin, yahoo and eharmony. they released the annual list of the most common worst passwords according to hackers who got them in the past.
2:58 am
pass word, as a pass word and 123456 as another pass word. further down, monkey, trust no one, ashley and new this year jesus. if any of these are your passwords that you use, i hope i don't have to tell you what to do right now. that will do it for us today. thank you for joining me. america goes to the polling place to vote. we have the election issues covered here. keep it here where wall street meets main street. have a great week, everybody. i will see you again next weekend.
2:59 am

Wall Street Journal Rpt.
NBC October 28, 2012 2:30am-3:00am EDT

News/Business. JJ Ramberg. (2012) Bob Doll, BlackRock; author Greg Smith; JJ Ramberg ('Your Business'). New. (CC) (Stereo)

TOPIC FREQUENCY Us 6, Goldman 5, Goldman Sachs 4, Greg Smith 4, U.s. 4, Obama 2, America 2, Exxon Mobil 1, Condoleeza 1, Chevron 1, Pfizer 1, Nfib 1, Aflac 1, Ford 1, Fiat 1, Microsoft 1, Muppets 1, Sachs 1, On Facebook 1, Pendulum 1
Network NBC
Duration 00:30:00
Rating PG
Scanned in Annapolis, MD, USA
Source Comcast Cable
Tuner Channel 78 (549 MHz)
Video Codec mpeg2video
Audio Cocec ac3
Pixel width 528
Pixel height 480
Sponsor Internet Archive
Audio/Visual sound, color

disc Borrow a DVD of this show
info Stream Only
Uploaded by
TV Archive
on 10/28/2012